European Midday Update: Major Indices Go Green for Telecom Stocks - TheStreet

European Midday Update: Major Indices Go Green for Telecom Stocks

A telecom buying spree across Europe marks the end of Italy's 3G mobile-phone license auction.
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LONDON -- European markets rose Tuesday morning as investors celebrated the early end of the Italian auction for third-generation mobile-phone licenses by buying telecom shares. By midday, the

FTSE 100

was up 82.4 points to 6398.3, the

CAC-40

in Paris was up 116.5 points to 6298.8 and the

Xetra Dax

in Frankfurt was up 150.5 points to 6771.4.

The Italian auction for 3G licenses ended abruptly on Monday after only two days when

British Telecom

(BTY)

and its partners in the

Blu

consortium

pulled out of the auction following a major spat about the levels of shareholding within the group. The total bid for the five licenses was only $10 billion, far short of the $25 billion the Italian government was hoping for. The government is, needless to say, apopletic and is making threats, which include suing Blu and withholding its $1.7 billion deposit.

On the Continent, major gainers included

KPN

(KPN)

, up 10.4% to 25.40 euros ($21.340);

Deutsche Telekom

(DT) - Get Report

, up 7.2% to 42.33 euros;

France Telecom

(FTE)

, up 5.4% to 118.00 euros; and

Telefonica

(TEF) - Get Report

, up 4.9% to 22.65 euros.

Despite the threats and a downgrade by

Goldman Sachs

, BT shares bounced strongly from a session low of 690p to stand up 40p at 747 ($10.83).

Vodafone

(VOD) - Get Report

also looked firm as it made a determined effort to breach resistance around 284p. The shares were up 3.5p to 284.5.

In the tech sector, the

Techmark 100

was up 59 points to 3486.

Parthus

(PRTH) - Get Report

fell to an early low of 240p, but recouped some of the losses to stand down 9p at 275.5.

ARM Holdings

(ARMHY)

also fell before bouncing to stand just 3p lower at 676.

Oil stocks were better.

BP

(BPA)

gained 7p to 623, while

Shell

(SC) - Get Report

put on 4.5p to 592.5.

In the media sector,

Reuters Group

(RTRSY)

rose 61p to

13.33 after announcing that it has formed a online foreign exchange venture with

Chase

(CMB)

,

Citigroup

(C) - Get Report

and

Deutsche Bank

(DTBKY)

.